The Dynamic Linkages Among Exports, R&D and Productivity


  • We wish to thank two anonymous referees and participants in the EARIE 2013, JEI 2013 and INTECO 2013 conferences for their comments and suggestions on previous versions of this paper. We acknowledge financial support from Ministerio de Ciencia e Innovación (projects ECO2011-25033 and ECO2011-30323-C03-02) and Generalitat Valenciana (project PROMETEO/068).


This paper estimates a dynamic model of a firm's decision to export and invest in R&D, in which we allow past export and R&D experience to endogenously affect productivity. In our empirical strategy, we proceed in two steps: in the first step, using as starting point the traditional control approach method to estimate total factor productivity, we consider a more general process driving the law of motion of productivity in which we recognise the potential role that export and R&D experience might have in shaping future firms' productivity, and test whether this assumption holds; in the second step, we estimate a bivariate dynamic model of the firm's decision to invest in R&D and export, in which we analyse the linkages among investing in R&D, exporting and productivity. Using a representative sample of Spanish manufacturing firms for the period 1990–2009, we find that both export and R&D positively affect future productivity, which will drive more firms to self-select in those activities.